The search for a fast-rising stock usually lends itself well to a myriad of popular growth stocks investors typically focus on. And in this market, most investor attention is clearly being paid to a number of top growth-heavy tech stocks.
But outside of the tech sector, there are other less-obvious names that have been surging of late. One of the top fast-rising stocks I’ve had on my radar for some time is Fortis (TSX:FTS), and this is a company I think could be headed much higher from here.
Let’s dive into why Fortis is a top dividend stock investors should also consider for its growth profile right now.
Defensive business model with plenty of growth upside
Fortis’s core business model is one which provides very steady and stable cash flows over time. As a regulated utilities business, the company’s extensive portfolio of assets continues to produce consistent growth, as regulators approve higher prices over time to fund expansion projects and capital spending.
With around 3.4 million customers in the company’s purview, Fortis has been able to deliver strong dividend growth over time. A Dividend King with more than 50 years of consecutive dividend hikes, this is a company I’ve pounded the table on for a long time for this reason alone.
However, I think the company’s status as a Canadian utility giant is perhaps more important to consider. This is a company with a strong growth profile that could continue to see strong growth as energy demand rises over time. Whether it’s the rise of artificial intelligence or electric vehicles, there are strong secular growth trends underpinning the utility sector that should continue to drive growth.
Excellent financials
These strong growth drivers are factoring into some impressive results. The company’s revenue rose to $2.67 billion during the past quarter, up from $2.594 billion the same quarter the year prior. More importantly, net income surged 26% to $294 million, or $0.61 per share. This more than covers the company’s dividend over time.
As long as Fortis continues to provide revenue and earnings growth in line with these sorts of figures, this is a stock long-term investors can own.
Bottom line
Overall, there are a few choices on the TSX for the Canadian investor looking for this kind of stability and growth from Fortis. The company has produced outstanding top and bottom-line growth on a consistent basis. Moreover, its business model works, evidenced by a long track record of growth that few in the industry have. Hence, I believe this is a top Canadian dividend stock investors may want to consider not only for its yield but its growth potential as well over the long term.
